It is one thing to tell students that credit cards carry high interest rates, it is probably more effective for learning to have them actually input those high interest rates into their own credit card calculator to see the impact on payments. In this activity “Excel: Build a Credit Card Calculator,” students get an opportunity to flex their spreadsheet muscles through an activity that provides four options based on level of expertise. Please share this with your math department too as this activity helps students understand the mathematical underpinnings of credit card calculators and develop a deeper understanding rather than just inputting factors into an online calculator.
The activity starts with a basic scenario that includes information about a credit card balance, a minimum payment amount and an A.P.R. (Annual Percentage Rate). It then scaffolds the problem based on the level of Excel skills of your students so that it meets them where they are at. For students with no Excel skills, it provides hints to allow students to complete the task the old-fashioned way, through basic math operations. The students are asked questions regarding time to pay off this credit card balance as well as the amount to be paid off so students can see that a $1,000 credit card balance paid down by the minimum payment each month has a multiplier effect (like compound interest working against you as a borrower!).